State pension to recoup $11M

Tuesday

Dec 31, 2013 at 2:00 AM

The money comes from a settlement with Countrywide Securities over mortgage-backed securities.

THE ASSOCIATED PRESS

BOSTON — The Massachusetts state employees' pension fund will receive more than $11 million as part of a settlement with Countrywide Securities Corp., state Attorney General Martha Coakley said Monday.

The settlement was announced as part of Coakley's industry-wide review of residential mortgage securitization practices in Massachusetts.

The total settlement with Countrywide is $17.3 million. It includes a $6 million payment to the state.

The pension fund can also expect to receive an additional $7 million early in 2014 as a result of a $34 million settlement with JPMorgan announced by Coakley's office last month.

The settlements with Countrywide and JPMorgan are the latest in a series of six similar settlements with total payments of more than $300 million going back to 2009, according to Coakley.

"It is important to hold Wall Street accountable for its role in the subprime lending crisis," Coakley said in announcing the latest settlement.

Coakley, who is also a Democratic candidate for governor next year, said her office was the first in the nation to investigate and go after Wall Street securitization firms for their role in the mortgage meltdown.

Besides actions involving the securitization of loans, Coakley's office has also obtained settlements with Countrywide, Fremont Investment and Loan, Option One and others on behalf of Massachusetts homeowners.

In 2012, she joined a $25 billion nationwide settlement with the five major lenders over unlawful foreclosure practices.

She used money from the settlement to create a new HomeCorps program designed to provide assistance to borrowers.

The foreclosure crisis has begun to ease somewhat in Massachusetts.

Over the first six months of the year, there were 2,943 petitions to foreclose filed in Massachusetts, compared with 9,425 during the same six-month period in 2012.